Joe Eaton stories from The Center for Public Integrity

After Sandy Hook shootings, NRA campaign clout still formidable

2013-04-30T22:39:15-04:00

The National Rifle Association is keeping silent in response to calls for gun control measures in the wake of the massacre at Sandy Hook Elementary School in Newtown, Conn. Yet the massive trail of political money spent by the group shows the potent force any proposals for new restrictions will likely face when the anger and dismay over Sandy Hook recedes.

Since President Barack Obama took office, the NRA has spent millions to lobby Congress on gun legislation and bankroll the campaigns of supportive candidates. From 2009 through the first three quarters of 2012, the NRA spent more than $8.5 million to lobby on gun bills, according to mandated federal lobby disclosure records, most often to block proposed limits on weapons and ammunition access or support efforts to expand the right to carry concealed weapons in public. Direct federal lobbying accounts for only a small portion of the association’s total spending to influence state and federal gun policy; according the NRA’s 2010 tax return, it spent more than $20 million on “legislative action” that year. Much of the recent legislation on concealed weapons, in particular, has been at the state level.

Although federal lobbying disclosure records do not include itemized NRA spending on each bill, documents show that the association took sides on a number of initiatives, including a 2011 bill introduced by Sen. Frank Lautenberg (D-N.J.) that would have banned magazines holding more than 10 rounds of ammunition. Both Adam Lanza, the Sandy Hook Elementary School shooter, and Jacob Roberts, the masked gunman who killed two at an Oregon mall shooting earlier this month, carried high-capacity clips and civilian versions of the military M-16. Lautenberg has pledged to reintroduce the bill, which languished in committee during the 2012 session.

An assault weapons ban in effect from 1994 to 2004 included a ban on new high-capacity magazines. Gun-control advocates argue that large-capacity magazines allow criminals to quickly inflict mass casualties, since shooters do not need to reload until a clip is empty. The NRA, however, has said banning large-capacity magazines puts gun owners at risk at the hand of criminals. The ability to fire multiple shots improves “their odds in a defensive situation”, the NRA has said, particularly when assaulted by multiple assailants.

The association also lobbied against a second failed Lautenberg bill that would have prohibited online ammunition sales and required reporting of bulk ammunition purchases.

In addition to wielding its power in Congress, the NRA has long provided financial ammunition for candidates who share its values. Over the course of the 2010 and 2012 election cycles, the NRA’s political action committee contributed a total of more than $2 million to federal candidates, the overwhelming majority of whom were Republicans, according to Center for Responsive Politics. Since 2009, the NRA has also put more than $1 million into state campaigns, according to the National Institute for Money in State Politics.

The NRA has long been both respected and feared for its political muscle. In response to the 1994 assault weapons ban, the group is widely credited with helping engineer a Republican takeover of Congress. By contrast, more recently some NRA-backed candidates have lost, including Josh Mandel, the 2012 Republican challenger to incumbent Ohio Sen. Sherrod Brown, and former Wisconsin Gov. Tommy Thompson, who was defeated for a Wisconsin Senate seat by Democrat Tammy Baldwin.

Liberals are hoping that revulsion over the Connecticut shooting could further alter the political dynamic regarding the NRA. At least one beneficiary of the organization’s money appears to be backing away from NRA talking points. On Monday, Sen. Joe Manchin (D-W.Va.), who received $4,500 from the association for his 2012 campaign— the only Senate Democrat to receive NRA money, according to Center for Responsive Politics— announced that he may be open to gun control initiatives.

Rep. John Yarmuth, a moderate Kentucky Democrat, said Monday that the NRA is using its deep pockets to “instill fear in our citizens and politicians.” In a statement posted on his website, the pro-gun Yarmuth said the NRA “wants us to believe that the best protection against the irresponsible and lethal use of guns is for everyone to be armed. And while no specific gun regulation may have prevented the deaths of the 20 Sandy Hook Elementary children … the answer simply cannot be a gun in every elementary school lunchbox.”

The NRA did not respond to requests for comment.

At Wal-Mart and elsewhere, jobs provide few hours, little stability

Wal-Mart Stores, Inc. — 2012-11-25T10:23:07-05:00

Shoppers heading to Wal-Mart on Black Friday in search of deals will likely be met by protesting workers. The protestors, who are organized by the union-supported group OUR Walmart, are asking the nation’s largest private-sector employer for dependable schedules and full-time jobs for those who want them.

It’s a request that is sure to resonate across the retail industry. Although retail is a relative bright spot in the labor market with a growing number of jobs, the Center for Public Integrity recently showed that the positions often offer less than full-time hours and unpredictable schedules, which means less stability and smaller paychecks than in the past.

In some cases, workers are hired for “call-in” shifts, which require them to call their stores a couple of hours before they are scheduled to work to see if they are needed. This flexibility has been a boon to employers, who cut labor costs by calling in workers on busy days, like Black Friday, and keeping them off the payroll when business is slow. But for workers, is has meant the end of a dependable weekly paycheck.

Blistering inspector general report says feds are failing to fight Medicaid home care fraud

2013-01-23T12:40:21-05:00

Like a growing number of disabled Americans on Medicaid, Keith Foreman, a 57-year-old in Metropolis, Ill., qualified for a personal caregiver to help him with daily activities like dressing, shaving, and preparing meals.

Foreman, who prosecutors say suffers from a spinal injury, hired his girlfriend, Sheila McDonald, for the job. In 2011, McDonald received almost $5,000 from Medicaid for six months of care she provided to Foreman.

These personal care services, which are available in all 50 states, are designed to help the sick, elderly, and disabled remain in their homes — and out of expensive nursing facilities. But Foreman was not living at home. During the days marked on McDonald’s timesheets, Foreman was housed in the Massac County jail in Illinois, serving time for forging a stolen debit card signature at a local liquor store.

Like Foreman and McDonald, who both pleaded guilty to charges of making false statements, unscrupulous beneficiaries and home health workers are increasingly targeting personal care services programs for illegal money-making schemes, according to a new federal report. Investigators say lax requirements for both caregivers and patients, along with poor state and federal oversight, has made the rapidly growing programs a lucrative target for fraud. And this isn’t the first time they’ve issued such a warning.

Report faults federal oversight of state programs

A Health and Human Services Office of the Inspector General (OIG) report scheduled to be released today faults the Centers for Medicaid and Medicare Services (CMS) for inadequate oversight of personal care services programs, whose costs are shared by states and the federal government, as is the norm for Medicaid. The report, which brings together six years of OIG investigations and 23 reports on the topic, describes a program hindered by poor claims documentation, insufficient monitoring of claims data for fraud and waste, and a crazy-quilt of varied requirements for personal care workers in different states.

“Historically, CMS has left a lot of the responsibility for overseeing waste, fraud and abuse to the states,” said Christi Grimm, special assistant to the principal deputy inspector general. “As a result, we have 301 different sets of requirements for caregivers across the states.”

Although some states mandate criminal background checks and licensing for home health workers, Grimm said others lack even the most basic requirements, including age minimums, which has led to cases in which juveniles escape prosecution for fraud and abuse. Worker requirements are set by counties in a number of states, she added, which has led to a hodge-podge of rules that are difficult to enforce, and nearly impossible to monitor.

“We are asking CMS to step up to the plate,” Grimm said, and use its authority to regulate and monitor the state programs.

The report includes six previous OIG recommendations to CMS and state agencies which have gone unimplemented. In a 2008 report that found five states may have paid up to $11 million in error for personal care services during one quarter of 2005, OIG recommended that the CMS work with states to stop payments for personal care when patients were receiving care in institutions, not at home. The agency agreed with the recommendation, but according to the OIG, the work has not been completed.

In addition to asking the agency to address previous recommendations, the report offers four new goals for CMS to improve oversight and monitoring of state plans, including standardizing rules for personal care workers to set minimum age and education levels, and require criminal background checks.

The report, however, seems unlikely to spur the agency to follow the OIG’s specific suggestions.. In a written response, CMS — part of the Department of Health and Human Services — explicitly concurred with only one of the OIG recommendations: that it should provide states with claims data to help root out cases in which beneficiaries are simultaneously receiving both institutional care and home health services. In response to the recommendation on establishing federal guidelines for personal care workers, CMS pointed out there is a shortage of care attendants.

“Personal care services are an important part of keeping people in their homes and out of nursing homes, which lowers costs and improves the quality of life of the patient,” said CMS spokesman Brian Cook. “We are working to protect personal care from fraud and abuse by promoting stronger training programs for workers who provide personal care, working with states on background check programs for these workers, and developing new data methods to analyze claims for potential fraud and abuse."

Grimm called the CMS response to the report unacceptable. “It’s not uncommon for CMS … to identify things on the horizon, or things they hope to do, but not necessarily commit to doing something,” Grimm said, adding that CMS’s efforts so far simply have not worked. “[CMS] has the authority to do what we are asking. It has not done it yet. And it hasn’t committed to doing it after reading our report.”

A wealth of opportunities

According to investigators, most fraud schemes in personal care services involve billing for care that was not provided or was not allowed. Self-directed programs, which allow beneficiaries to hire and manage their helpers, may be particularly vulnerable, but some prosecutions have also involved home health care agencies.

In January, for example, the owner of a Minnesota home health care company outside Minneapolis was sentenced to two years in prison for cheating Medicaid out of more than $650,000 in charges for personal care services. In March, the owner of Families First Home Health Care in Sparta, N.C., pleaded guilty to fraud and money laundering stemming from a scheme in which she billed Medicaid for personal care services she did not perform and split the proceeds with plan members.

“Fraud goes where the money is,” said Barbara Zelner, executive director of the National Association of Medicaid Fraud Units, which represents state law enforcement agencies that investigate Medicaid fraud. After nursing homes, Zelner said, home health represents one of the larger slices of state Medicaid budgets.

Personal care services programs have grown quickly since a 1999 Supreme Court decision held that unjustified segregation of the disabled is a civil rights violation. The ruling led to increased spending for home health services; in 2011, Medicaid paid more than $12 billion for personal care services, up 35 percent since 2005, according to the OIG. Investigators say program fraud has kept pace. In 2010, state Medicaid fraud units investigated more than 1,000 cases involving personal care services, more than any other type of Medicaid service.

Not everyone agrees with the OIG’s views on personal care services. In 2011, an OIG review of Medicaid claims for personal care services in New Jersey found that 40 percent should have been denied. Sherl Brand, president of the Home Care Association of New Jersey, which advocates for home health care providers, questions the OIG’s work, saying the agency often draw broad conclusions from examinations of a limited number of claims. “It is almost a bit ridiculous because of the extrapolation they do,” Brand said.

New Jersey home health workers face criminal background checks and certification and licensure requirements, Brand said. Personal care services programs save money, she said, in addition to helping disabled people live better lives. When New Jersey was faced with budget cuts, Brand said the association determined the average weekly cost for personal care services was $242 dollars a week, only slightly higher than the cost of a single day in a nursing home.

But as funding for the programs increase, fraud follows. Kirk Ogrosky, a former top federal health care fraud prosecutor who is now a partner at the Washington law firm Arnold & Porter, said home health has long been a hotbed of fraud, both in Medicaid and in Medicare. The fraud, he said, is not hard to uncover. Ogrosky recalled that after an extensive analysis of Medicare claims, he sent agents out to interview questionable beneficiaries. When the agents knocked on the doors, they often learned the person they were looking for was at work, Ogrosky recalled. “That’s utterly preposterous,” he said, “since home health requires that you are homebound.”

In other cases, Ogrosky said, agents found that home health care agencies were filing claims for beneficiaries who did not live at the homes indicated on the claims. “One of my favorite stories is about a homeless guy we found,” Ogrosky said. “He didn’t even have a home to be homebound to.”

IMPACT: Cabinet officials signal crackdown on Medicare billing abuse

2012-10-09T22:18:29-04:00

Top federal officials are stepping up scrutiny for doctors and hospitals that may be cheating Medicare by using electronic health records to improperly bill the health plan for more complex and costly services than they deliver.

U.S. Health and Human Services Secretary Kathleen Sebelius and Attorney General Eric Holder notified five medical groups of their intention to ramp up investigative oversight, including possible criminal prosecutions, by letter on Monday.

The government action follows The Center for Public Integrity’s “Cracking the Codes” series, published last week. The year-long investigation found that thousands of medical professionals have steadily billed higher rates for treating seniors on Medicare over the last decade — adding $11 billion or more to their fees.

The Center’s probe uncovered a broad range of costly billing errors and abuses that have plagued Medicare for years—from confusion over how to pick proper payment codes to outright overcharges. The findings indicated that Medicare billing problems are worsening as doctors and hospitals switch to electronic health records.

“There are troubling indications that some providers are using this technology to game the system, possibly to obtain payments to which they are not entitled,” the letter states, adding: “There are also reports that some hospitals may be using electronic health records to facilitate ‘upcoding’ of the intensity of care or severity of patients’ condition as a means to profit with no commensurate improvements in the quality of care.”

The letter said that “false documentation of care is not just bad patient care; it’s illegal.” The Centers for Medicare and Medicaid Services, which oversees the program “is specifically reviewing billing through audits to identify and prevent improper billing.” The letter went on to say that CMS is “initiating more extensive medical reviews to ensure that providers are coding…accurately.”

The letter adds that “law enforcement will take appropriate steps to pursue health care providers who misuse electronic health records to bill for services never provided. The Department of Justice, Department of Health and Human Services, the FBI and other law enforcement agencies are monitoring these trends and will take action where warranted.”

Most of the five groups sent the letter on Monday had no comment. The American Hospital Association said it agreed that upcoding should not be tolerated, but added that “more accurate documentation and coding does not necessarily equate with fraud.” The group also asked federal officials to develop national guidelines for hospital emergency department and clinic visits —a request the group said it hade made 11 times since 2001.

The group said it does not question the need for auditing to identify billing errors, but added that “the flood of new auditing programs…is drowning hospitals with a deluge of redundant audits, unmanageable medical record requests and inappropriate payment denials.”

The suggestion that digital medical gear has fueled a rise in potentially improper medical billing is a touchy one for the Obama administration, which has championed electronic health records as a means to both improve the quality of medical care and cut costs. The administration is spending more than $30 billion in economic stimulus funds to help doctors and hospitals purchase the gear. More than half the nation’s hospitals have received some payments from the program, according to HHS.

But critics have also noted that digital medical and billing equipment can with the touch of a button create an exquisitely detailed medical file and thus present a challenge to government auditors concerned about preventing fraud.

The letter sent Monday was the first acknowledgment by top federal officials that the digital era may spawn more costly Medicare fraud and billing abuse. In the past, federal officials have largely accepted the explanations of doctors and hospitals that higher-level billings are mainly the result of patients on Medicare getting sicker and older and taking more time to treat—even though there’s little evidence to back that view.

Sebelius and Holder took aim at the common practice of using electronic health record software to “clone” documentation from previous medical visits “in order to inflate what providers get paid.”

“We will not tolerate health care fraud,” the letter states. “The President initiated in 2009 an unprecedented cabinet-level effort to combat health care fraud and protect the Medicare trust fund and we take those responsibilities very seriously,” the letter states.

Medicare’s shaky finances also have emerged as a presidential campaign issue, with both Barack Obama and Mitt Romney promising to tame its spending growth while protecting seniors. But there’s been little talk about the impact of billing and coding practices in driving up costs, and what to do about them.

Medicare pays doctors for office visits using five escalating payment codes, which range from a minimal visit of about five minutes for about $20 to about $140 paid for more complex treatments that generally take 40 minutes or more of face-to-face time with the doctor. Federal officials expect doctors to report a range of the five codes because some patients require more time and effort to treat than others. Medicare uses the scales to pay for more than 200 million office visits each year and other doctor services that cost taxpayers more than $33 billion.

But doctors over the past decade have increasingly spurned lower-level codes for ones that pay better —even though there’s little hard evidence that they spent more time with patients or that patients were sicker and required more complicated and time-consuming care. Hospitals also use the billing codes, and the Center found similar problems with billing for emergency room services.

More than 7,500 physicians billed the two top-paying codes for three out of four office visits in 2008, a sharp rise from the numbers of doctors who did so at the start of the decade, the Center’s data analysis found. Officials said such changes in billing can signal that some doctors are billing for more complex services than they delivered, a practice known as “upcoding.”

As the government has invested more heavily in electronic health records, hundreds of technology firms have begun marketing digital records system, often doing so by promising doctors and hospitals that they can significantly boost revenues with the devices.

Most manufacturers and the hospitals using the gear contend that the digital gear merely allows them to more efficiently bill for their services, which in the past were often done by hand.

In 2010 alone, Medicare paid for more than six million more patient visits at the second highest level code, 99214, than the year before. That upsurge cost Medicare more than $1 billion, government records show.

CMS acting Administrator Marilyn Tavenner earlier this year confirmed that the agency planned to contact as many as 5,000 doctors it identified as billing outside norms, but said the effort was “not intended to be punitive or sent as an indication of fraud.”

She said the agency would focus on the top ten high billers in each Medicare region as a first step, but that it might cost the agency more to investigate suspicious claims than it could collect.

The agency, Tavenner wrote in a letter published in a May Inspector General’s report , “must take into account the respective return on investment of medical review activities.”

The five medical groups sent the letter are: the American Hospital Association, the Association of Academic Health Centers, the National Association of Public Hospitals and Health Systems, the Federation of American Hospitals.

The association of public hospitals said in a statement that it “shares the government’s goal of a health care system that offers high-quality, affordable care. Our hospitals and health systems adhere to high ethical standards and reject practices that might result in fraudulent or improper claims. We stand ready to help regulators understand fully the many aspects of electronic health record use in the hospital setting as they consider actions to ensure proper billing practices.”

Hospitals grab at least $1 billion in extra fees for emergency room visits

2013-01-23T12:40:21-05:00

Judging by their bills, it would appear that elderly patients treated in the emergency room at Baylor Medical Center in Irving, Texas, are among the sickest in the country — far sicker than patients at most other hospitals.

In 2008, the hospital billed Medicare for the two most expensive levels of care for eight of every 10 patients it treated and released from its emergency room — almost twice the national average, according to a Center for Public Integrity analysis. Among those claims, 64 percent of the total were for the most expensive level of care.

But the charges may have more to do with billing practices than sicker patients. A Baylor representative conceded hospital billing for emergency room care “did not align with industry trends,” but said that the hospital since 2009 has reined in its charges.

The Texas hospital’s billing pattern is far from unique. Between 2001 and 2008, hospitals across the country dramatically increased their Medicare billing for emergency room care, adding more than $1 billion to the cost of the program to taxpayers, a Center investigation has found. The fees are based on a system of billing codes — so-called evaluation and management codes — that makes higher payments for treatments that require more time and resources.

Use of the top two most expensive codes for emergency room care nationwide nearly doubled, from 25 percent to 45 percent of all claims, during the time period examined. In many cases, these claims were not for treating patients with life-threatening injuries. Instead, the claims the Center analyzed included only patients who were sent home from the emergency room without being admitted to the hospital. Often, they were treated for seemingly minor injuries and complaints.

While taxpayers footed most of the bill, the charges also hit elderly patients in the pocketbook, increasing the amount of their 20-percent co-payments for emergency room care.

Hospitals and federal officials say the rise has likely been caused by an increase in sicker patients seeking care in emergency rooms, more accurate billing on the part of hospitals, and an increasing number of options for patients who aren’t as sick — options that include retail-based clinics and urgent care facilities. But the Center’s investigation found that the surge in billing also reflects lax government oversight, confusion about proper billing standards, and widespread payment errors that have plagued Medicare for more than a decade. And the data suggest that some hospitals are working the billing system — and its flaws — to maximize payments.

Dr. Donald Berwick, the immediate past administrator of the Centers for Medicare and Medicaid Services (CMS), which administers the Medicare program, said a small portion of the billing increase is likely caused by outright fraud, but in the majority of cases hospitals are legally boosting profits by targeting the vulnerabilities of Medicare’s payment system. “They are learning how to play the game,” Berwick said about the hospitals.

Hospital industry insiders say it’s no secret that hospitals are pushing the limits to bill higher-priced Medicare codes, a practice known as upcoding. “There is such financial pressure to upcode,” said Barbara Vandegrift, a health care consultant at Tennessee-based Quorum Health Resources. “It’s ‘wait until we get caught and we’ll fight it at that point.’ ”

Few hospitals, however, are being scrutinized. Medicare officials are aware of the rising expense of emergency room billing for evaluation and management services, but the agency has downplayed the problem and done little to verify the accuracy of hospital emergency room charges. Instead, it has given hospitals a free hand to set their own billing policies, with little agency guidance and even less auditing.

Medicare lacks rules for hospital ER billing

Since 2000, hospitals have chosen among five codes to bill Medicare and other insurers for evaluating emergency room patients and coordinating their treatment. This hospital “facility fee,” which can add millions of dollars to the hospital’s bottom line in the course of a year, ranges from $50 to $324, depending on which code is chosen for any given case. It comes on top of physician charges.

The system dates back to a change in federal law requiring hospitals be paid a set fee for services, rather than a blanket payment based on the cost of providing care, which was meant to save the program money. Yet instead of developing specialized billing codes just for hospitals, CMS since 2000 has required hospitals to file claims using a set of codes developed and licensed for physician billing by the American Medical Association — so-called Current Procedural Terminology, or CPT, codes. The lack of specific hospital codes, or guidelines for how hospitals should use physician codes, has left the system open to broad interpretation by hospitals.

“All the hospitals looked at each other and said, ‘OK, how are we going to do this?’ To make a long story very short, we still have no guidelines,” said Duane Abbey, a hospital billing consultant in California.

Medicare administrators acknowledge as much. Since 2000, CMS has repeatedly announced plans to develop new hospital evaluation and management codes, or at least provide national guidelines for hospital billing. But the agency has failed to deliver. Instead, CMS requires hospitals to develop their own guidelines for billing those codes designed for doctors. Some follow strict internal policies, Abbey and other hospitals billing consultants said, while others wildly inflate charges, regularly change their billing criteria, and sometimes fail to follow even their own lax internal policies.

“The whole issue of the E and M levels for the emergency department … is an absolute mess,” Abbey said.

Chasing dollars

Left to develop their own billing rules, hospitals have flocked to higher paying emergency room codes. Leatrice Ford, an independent consultant in Louisville, Ky., who uses Medicare claims data to advise hospitals on their emergency room billing, said it’s well known in the industry that many hospitals inflate their charges. But Ford said it’s a tough sell for a consultant to convince hospitals their billing is too high. “In my experience hospitals are reluctant to give up their overpayments,” Ford said. The reason, she said, is that Medicare and the contractors it employs to administer payments are not checking.

“I have never once seen or heard of anyone being audited or called on the carpet for their distribution of E and M codes,” Ford said. “That’s a standard audit for physician practices, but I’ve never seen a hospital get in trouble for it.”

In 2008, more than 500 hospitals of the more than 2,400 in the database billed the two most expensive codes for more than 60 percent of patients. More than 100 billed the two most expensive codes for at least 70 percent of patients.

Some — like Baylor Medical Center in Irving — were even higher. In 2007, Yuma Regional Medical Center, a 369-bed nonprofit hospital in southwestern Arizona, billed the top two most expensive codes for eight of every 10 Medicare emergency room patients. Billing at the hospital made Yuma, Arizona, the nation’s regional leader for the percentage of billing of the top two levels of E and M codes, far higher than metropolitan areas like New York City and Chicago.

Yuma’s CEO Pat Walz, however, said the charges are accurate. When the Center first asked about the claims, Walz said elderly winter visitors have driven up the hospital’s number of serious emergency room cases. Yuma claims data reviewed by the Center for Public Integrity, however, suggest the average age of the hospital’s emergency room patients remained steady from 2001 to 2008 at around 77 years old.

Walz also conceded that the installation of Medhost, an electronic emergency department information system, was likely one of the most significant drivers of the hospital’s push toward more expensive codes. Before Medhost, nurses and doctors wrote patient notes by hand, Walz said. Computerized charting captured much more of the work they actually performed, which he said resulted in higher E and M levels.

But Walz said the electronic system is not overcharging Medicare. Rather, it is simply helping the hospital make money from care that once fell through the cracks. “If you look at any industry — as it goes from human to electronic input, the same thing is going to happen,” Walz said.

Walz said Medhost has paid for itself through increased billing, but he said the decision to install it was not financial. “We did it to improve the quality of patient care,” he said. Medhost did not respond to requests for comment.

CMS: hospital billing increase “slight”

The Centers for Medicare and Medicaid Services has so far downplayed the spike of hospital billing. In 2011 comments published in the Federal Register, CMS said it noticed a “slight shift” toward hospital billing of more expensive evaluation and management codes. The agency said it also noticed that emergency room charges for the higher-level visits “seem to be trending upward year over year.”

Presented with the Center’s analysis, which shows a far more dramatic shift toward expensive codes, CMS declined interview requests. But in written responses to questions, the agency’s press office said the trend is only “notable” over several years. Considered year to year, as the agency said it examined the data, the higher level codes increase at no more than 2 percent.

Further, the agency wrote that the trend may reflect more accurate coding by hospitals and physicians rather than upcoding. Indeed, the agency said its advisory panel, which is made up of physicians, hospital administrators and other hospital financial staff, told CMS that the rise in billing is a result of hospitals getting better at capturing their costs.

“They would argue that the costs were inadequately reflected in our data several years ago,” the agency wrote, “so the increases we are seeing now are bringing the payment system to where it should have been all along.”

Dr. Scott Manaker, a professor of medicine at the University of Pennsylvania Perelman School of Medicine, a member of the panel, said there are a number of possible causes for the rise in high-level billing, including more accurate hospital coding. Manaker said he doubts upcoding is the major cause, but said it’s impossible for the panel to determine without examining individual patient charts and hospital billing records, which it has not done.

Another panel member said hospital emergency room billing has not been a critical issue during meetings. “In my four years in the panel there has not been a lot of discussion of E and M leveling on the facility side,” said Judith Kelly, director of health information management at Unity Health System in Rochester, N.Y. To address the issue, Kelly said CMS should issue hospital-specific billing codes or guidelines for emergency care. “When there is ambiguity, there are problems,” she said.

In response to questions, CMS said some hospitals have been audited. But the agency said the process of auditing and seeking reimbursement of overpayment is “expensive and time consuming relative to the potential return that will be realized on individual claims for relatively low cost services.”

But some question whether CMS contractors — who help administer Medicare payments — can effectively audit hospital billing. Without national billing guidelines, said Abbey, the hospital auditor, it would be difficult for CMS contractors to determine who is cheating the system. Indeed, he said they would need first to ask each hospital for a copy of its internal billing guidelines. “They should have one of their famous committees developing guidelines right now,” Abbey said. “My sense is they aren’t, but they should be.”

A never-ending quest for billing guidelines

During the 12 years that CMS has allowed hospitals to set their own billing policies for E and M codes, a host of organizations have proposed national guidelines. So far, none of them have made the cut.

In 2002, the American Hospital Association (AHA) and the American Health Information Management Association, an association representing health information management professionals, formed an expert panel to develop guidelines for hospital emergency room billing at the urging of CMS. In 2003, the groups submitted detailed recommendations for a billing system that measured hospital emergency room care. The recommendations went nowhere. “It just died a slow death,” said William Briggs, a nurse who represented the Emergency Nurses Association on the expert panel.

CMS has called the AHA proposal the “most appropriate and well-developed guidelines” available. Yet the agency has not required hospitals to follow them. Not long after the AHA proposed the guidelines, a CMS-funded outside study found a number of problems with the guidelines.

A separate small-scale study, however, suggested the guidelines save money. In 2009, the Ohio-based company Permedion, which reviews medical claims for state and federal agencies, found that 37 percent of a sample of Ohio Medicaid emergency room claims should have been coded at lower levels, based on the AHA guidelines. The remainder were in agreement with the guidelines.

The AHA remains one of the loudest voices pushing for guidelines, but it is discouraged over the long delay. “We keep asking them to issue national guidelines,” said Nelly Leon-Chisen, the association’s director of coding and classification. “We do it every year and they don’t do anything about it.”

By 2007, though, it appears CMS had effectively given up on releasing new guidelines. The effort “was proving more challenging than we initially thought,” the agency wrote in the Federal Register.

Industry insiders say there are a number of reasons why the agency never established guidelines. Some suggested a working set of rules that accurately reflects costs for all hospitals may be impossible to develop. Others say CMS is reticent to sign off on an outside group’s system, as it has with the American Medical Association, which licenses the use of the CPT codes it owns and administers.

In written responses to questions submitted by the Center, CMS said “it seems unlikely that one set of straightforward national guidelines could apply to the reporting of visits in all hospitals and specialty clinics.” It also said the agency believes that “as a whole, hospitals have worked diligently and carefully to develop and implement their own internal guidelines that reflect the scope and type of services they provide.”

Asked about the hospital shift toward billing more expensive codes, Roslyne Schulman, the hospital association’s director of policy development, said she was unaware billing had risen at the rate revealed by the Center’s data analysis, and could only speculate on the reasons without comparing billing to patient charts. Asked if hospitals were simply billing for levels of care they did not provide, Schulman said, “I would hope that would not be an issue.”

Hospitals say patients are “sicker and older”

In 2008, Sentara Virginia Beach General Hospital, a 276-bed hospital a few miles from the Atlantic Ocean, billed the top two emergency room codes for 80 percent of all patients, up from about 29 percent in 2001. Hospital spokeswoman Amy Sandoval said the hospital since 2001 has used the electronic charge system Optum Lynx to determine evaluation and management billing levels.

In a written response to questions about the hospital’s billing, Sandoval said Optum reviewed the hospital’s billing and found it within acceptable limits. Sandoval said “possible” reasons for the high level of billing include an older and sicker patient population, the intensive resources required to treat psychiatric patients before transfer, and a trend of less sick patients seeking care outside of emergency rooms to avoid long waits and high co-pays. The hospital, she added, is a level III trauma center, located within a mile of seven assisted-living centers and nursing homes.

Representatives from small-town hospitals and major urban trauma centers generally offered the same justification for their rising charges. These explanations could be accurate for individual hospitals, but they are not borne out in the national Medicare billing data analyzed by the Center. The average age of emergency room patients in data examined by the Center was 77 and remained constant from 2001 to 2008. The total number of emergency room claims rose 31 percent during that time, however, as compared to a less than 10 percent increase in Medicare beneficiaries, which suggests urgent care clinics have not sapped overall business levels.

Some of the rise could be accounted for by emergency room care advances. In the eight years from 2001 to 2008, advances in medical care allowed emergency rooms to treat patients without later admitting them to the hospital. Since the Medicare data the Center for Public Integrity examined includes only treat-and-release patients, these sicker patients would be included in the data more often in 2008 than in 2001. But some experts strongly doubt this accounts for the extent of the rapid rise.

Moreover, the ten most common “primary diagnoses” — the chief complaints for why patients seek care in emergency rooms — remained unchanged during the time period of the data reviewed by the Center. Although those top diagnoses including dangerous symptoms like chest pain and loss of consciousness, the list also included seemingly minor complaints like lower-back discomfort, urinary tract infections and limb pain.

But while the most common diagnoses remained constant, billing of the most expensive codes surged. Take the case of emergency room headaches. From 2001 to 2008, hospital billing of the top two evaluation and management codes for headache patients more than doubled to 43 percent. The number of tests and procedures doctors performed on headache patients also rose. In 2001, hospital emergency rooms billed an average of six revenue codes (which represent areas of the hospital where costs occur, including imaging, labs, and supplies) for headache patients, according to Medicare billing data. In 2008, they billed an average of nine.

In addition to changes in standards of care over those eight years, hospitals say they simply are seeing sicker Medicare patients than in the past. But some disagree.

Berwick, the former CMS head, said patients haven’t changed. What’s changed is the aggressiveness of how hospitals bill. “They are smart,” Berwick said. “If you create a payment system in which there is a premium for increasing the number of things you do or the recording of what you do, well, that’s what you’ll get.”

Dr. Stephen Pitts, an emergency physician and associate professor in the Emory University School of Medicine, examined data from the Centers for Disease Control and Prevention’s National Hospital Ambulatory Medical Care Survey, a well-established nationally representative survey of emergency department visits. Pitts found that between 2001 and 2008 emergency patients did not appear to be getting sicker.

“It’s total nonsense,” Pitts said of hospital claims that sicker patients have led to higher charges.

Emergency physician billing also rises

A more likely cause, Pitts said, is the pressure hospitals put on emergency room physicians to bill every patient at the highest rates possible. Emergency room salaries at many hospitals are tied in part to how much profit doctors generate per patient, Pitts said. From the business side, this makes sense. “If you don’t bill maximally, your ER is going to die,” Pitts said. But from a patient perspective, it means doctors perform more tests and procedures than they did in the past, which increases the costs of care.

Although hospital facility charges are separate from physician charges, billing and coding experts say the two are linked. And like hospital charges, emergency room physician charges for evaluation and management services are soaring. In 2008, emergency room physicians billed the most expensive code for 44 percent of patients, up from 27 percent in 2001, according to Center analysis of Medicare claims data.

The cost associated with this rise is substantial. In 2010, the top level physical evaluation and management code for emergency care cost the program nearly $1.6 billion, up 21 percent form 2008.

Unlike hospital billing, CMS requires that physicians follow American Medical Association criteria for billing emergency room evaluation and management services. The top level code 99285, for example, requires doctors to perform a comprehensive medical history, a comprehensive exam and engage in highly complex medical decision making.

Yet a number of probes have found physicians are over-billing the top-level code. A 2012 probe of physician billing of 99285 in Iowa, Kansas, Missouri, and Nebraska found an error rate of almost 50 percent. The probe, performed by Medicare contractor Wisconsin Physicians Service Insurance Corporation, found that physician documentation did not support the 99285 level.

David McKenzie, the reimbursement director of the American College of Emergency Physicians, said upcoding is not to blame for the rise in physician charges. Emergency room doctors are simply getting better at documenting their work, and Medicare patients in general are getting sicker, McKenzie said. In addition, nurse practitioners and physician assistants are treating less sick patients who in the past would have been treated by doctors, which is skewing their numbers.

Evaluation and management of health care in seniors takes time, McKenzie said. “A broken leg in a 17-year-old football player is not the same as a broken leg in an 88-year-old diabetic.”

CMS says rise unlikely caused by upcoding

In written comments, CMS said upcoding is unlikely to account for the rapid rise in hospital emergency room billing since the trend appears “to be consistent across hospitals and physicians.” But billing at some hospitals is rising much faster than at others. Asked if the agency is monitoring hospitals, like Baylor Medical Center in Irving, Texas, with rates that were nearly twice the national average, CMS said it is inappropriate for the agency to discuss audits involving specific hospitals.

But Baylor Irving’s president, Cindy Schamp, said CMS never questioned the hospital’s 2008 evaluation and management code billing. In 2009, Schamp said, the hospital instituted new billing rules that led to fewer claims for the top two codes. She said the change was voluntary.

Asked if the hospital returned Medicare overpayments, Schamp said it has not. “To date, we have not made any payments back to Medicare,” Schamp wrote in response to questions. “However, continuing to work to do the right thing, we feel it is appropriate to review."

Four months later, a Baylor spokeswoman said the review was complete. “We looked at a sample set of (emergency room) charges made at Baylor Irving during that time period to see if they were accurate in the context of the billing guidelines at that time,” Nikki Mitchell wrote. “That is the appropriate way to review charges. In the review, no overcharges were found.”

Accounting for limousines: A moving target

2012-06-18T09:30:00-04:00

In these troubled economic times, it is perhaps not surprising that the federal government is a bit touchy on the question of just how many limousines it owns and operates. But now it turns out that even defining a limousine is a complex topic worthy of a government memo.

Just over a year ago, based on information in the annual Fleet Report issued by the General Services Administration, the Center for Public Integrity reported that the number of limousines owned by government agencies rose 73 percent from 2008 to 2010, to a total of 412. It was clear from the responses of government officials that a limo increase was not something the Obama Administration was anxious to take credit for.

In fact, at the time, a GSA spokeswoman asserted that the limo numbers in its own report were not reliable. “The categories in the fleet report are overly broad, and the term ‘limousine’ is not defined,” she said. The spokeswoman concluded that GSA “cannot say that its report accurately reflects the number of limousines.”

It’s now come to light that six weeks after the story ran, the GSA sent a memo to federal agencies with new guidance on what — exactly what — constitutes a limousine.

According to the memo, some agencies had reported vehicles that weren’t so classy — even shuttle buses — as limos, which a GSA spokesman said skewed the 2010 numbers.

A limo, the GSA memo states, “is a vehicle with a lengthened wheelbase, generally driven by a dedicated driver” with possible customization, including “privacy panels” and stretching for capacity and comfort. “Vehicles, including shuttle buses, without the aforementioned characteristics should not be reported as limousines,” the memo says.

The memo seems to have had quite an effect. Last month, the agency released its annual fleet report for 2011, and predictably, the number of government limousines plummeted, all the way down to 158, from 2010’s 412. That’s a drop of 62 percent.

Hillary Clinton’s State Department appears to have had the most trouble adding up its limos back in 2010. That year, the agency reported 259. In the 2011 report, the total is down to just 50.

In response to questions about its 2010 numbers, the department last year told the Center that it defined limousines as vehicles that carry VIPs, rather than the type of car, but also said its large armored fleet was in proportion to the number of diplomats serving in “high threat environments.”

Under the new limo criteria, the Department of Homeland Security shot to the front of pack in 2011, with 106 limousines. A DHS spokesman said the agency’s limos are owned by the Secret Service, which is under the agency’s umbrella. Secret Service spokesman Ed Donovan said the agency uses the vehicles to “transport dignitaries, people we are required by law to protect.”

The DHS total was followed by the State Department’s 50, and one at the Department of Justice. The Navy was the only limo gainer in 2011, adding a single car to its fleet. A number of agencies and departments that reported limousines in 2010, including the Army (18), the Agency for International Development (6), the Department of Interior (3), the Department of Veterans Affairs (1) and the Environmental Protection Agency (1), reported no limousines for 2011.

Leslie Paige, a spokeswoman for the nonprofit watchdog group Citizens Against Government Waste, questioned whether the GSA simply fixed an accounting error or is trying to drive down the number of limousines in its report for political reasons.

“I would never make the mistake of underestimating their ability to be incompetent,” Paige said. “Whether there is something more — wink, wink, nod, nod — here, you just can’t know. I can see if the [definition] issue is between a town car and a limo. But not shuttle buses. It doesn’t make sense.”

GSA officials concede that the new definition of a limo makes it impossible to compare the number of government limousines over time. “Going forward,” said GSA spokesman Adam Elkington, “the data will be much more accurate from year to year”.

On-call employment: Good for business, bad for workers

New York City,New York,United States — 2012-04-06T08:22:34-04:00

Like generations of college students, Caprice Taylor needed a job to help pay her school and living expenses. For the 24-year-old student of fashion merchandise management at the Fashion Institute of Technology in New York City, sales work at a retail clothing shop seemed like a good option.

Taylor was hired last year at Club Monaco, a high-end clothing and apparel retailer owned by Polo Ralph Lauren. But her scheduled shifts at the Manhattan store were not guaranteed. Instead, she was given call-in shifts, which required her to call the store two hours before she was scheduled to arrive to see if she was needed.

Most often, she was not.

For months, Taylor said, she arranged her personal life around work days, waiting in her apartment, only to call in and learn the store wasn’t busy enough. On some weeks, Taylor logged as few as six hours, not earning enough to keep up with her living expenses.

“It puts your day on complete hold,” Taylor said. “It pressures you.”

After four months of unpredictable paychecks, Taylor quit. She later found work at a Polo Ralph Lauren store that does not have on-call shifts. She was lucky to find it. Retail watchers say big-box stores and shopping-mall stalwarts are increasingly hiring workers for on-call shifts, a trend that cuts labor costs for employers, but leaves workers like Taylor struggling to get by.

The clothing and accessory retail industry is a relative bright spot in the moribund jobs market. Yet like Taylor, many workers are finding the jobs unpredictable at best, providing smaller paychecks and less stability than in the past.

From 2002 to 2011, the number of nonsupervisory jobs in the retail clothing industry rose 7 percent to 1.13 million, according to the Bureau of Labor Statistics. The industry declined during the recession, but the decline was not as dramatic as for the jobs market as a whole.

Despite the steady numbers, the quality of the retail sales positions is falling by at least one key figure — the average number of hours they provide. In 2011, nonsupervisory workers in the clothing retail industry worked an average of 22 hours a week, three hours less than in 2005. That drop in hours hit them in the paycheck.

Although average hourly wages rose by 40 cents to $11.47 during that time, workers earned an average of $248 a week, $22 dollars less than the pre-recession peak. For call-in shift employees, the situation is often far worse, said Carrie Gleason, director of Retail Action Project, a New York City retail worker advocacy group. The biggest problem with call-in shifts, Gleason said, is unpredictability. Employees can’t make reliable budget decisions because they don’t know how much money they will make each week, she said. And for parents, it’s difficult to find flexible daycare providers to work around call-in shifts.

While many have lamented the decline of traditional employment benefits, including paid time off and employer-sponsored health insurance, Gleason said call-in workers are struggling simply to make enough money to get by. They rarely are offered benefits, Gleason said, because they work too few hours and turnover is high. “It leaves workers scrambling and creates a situation where people are struggling along,” Gleason said.

Susan Lambert, a University of Chicago professor who studies hourly and low-income labor, said employers have an incentive to hire a large pool of workers and schedule call-in shifts based on demand. “It gives managers a lot of flexibility when you have a workforce that is hungry for hours,” Lambert said.

Pressure to contain labor costs is not new, but Lambert said it has increased since the recession. In addition to retail, on-call jobs are now common at hotels, airlines, in the package delivery industry, and even in some financial services jobs, she said. “This is so much bigger than it was 10 years ago,” Lambert said. “It’s becoming common practice for companies to have a large portion of their sales force on-call.”

For retailers, scheduling on-call shifts helps drive down labor costs, which Fred Hurvitz, a professor at Penn State’s Smeal College of Business, said can account for 40 percent or more of their total expenses. As brick-and-mortar retailers face stiff cost competition from online retailers and pressure to drive down prices, Hurvitz said, they are increasingly searching for ways to save. The cost of labor is one place they are looking to cut.

Workers and labor watchers say on-call shifts are on the rise, but the exact number is uncertain. The Bureau of Labor statistics has not looked at the issue since 2005, when 2.5 million workers held on-call jobs.

Ellen Davis, vice president of the National Retail Federation, is reluctant to call it a trend. Davis said the federation has no policy papers on the issue and that it hasn’t come up in meetings. “It’s not common enough that it has risen onto the radar,” she said.

At the Club Monaco store in New York where Caprice Taylor worked, a manager who declined to give her name said the store uses call-in shifts “depending on the needs of the store.” She declined to comment further. Calls to Club Monaco’s corporate office were not returned.

Hard on workers, call-in shifts a boon for business

Call-in shifts may cause instability for workers, but experts say they allow businesses to staff up when they are busy and staff down when business is slow.

Lisa Disselkamp, a private workforce management consultant in Richmond, Va., said modern scheduling systems can be linked to sales data, which gives managers the ability to fine-tune an optimum balance between customers and staffing. In the past, Disselkamp said, scheduling was done on paper, and managers allocated employee hours based on intuition and projected sales trends. “Payroll for a long time was just processing time sheets,” Disselkamp said. “Today these systems are very intelligent.”

Increasingly, managers begin their shifts by logging on to scheduling systems, or looking at messages the systems send to their smartphones, Disselkamp said. The most basic systems help managers determine if the current workload calls for additional or fewer workers. More advanced systems look at individual employee skills, cost, and availability, and determine the best choice to fill slots, sometimes only an hour or two before the workers are expected to arrive.

Disselkamp compared the rise of smart scheduling to the lean inventory trend in manufacturing, in which factories rely on regular delivery of materials from suppliers rather than filling large warehouses with supplies. Lean inventory allows manufacturers to cut costs by transferring financial risk onto suppliers. In lean scheduling, Disselkamp said, risk is transferred to the worker. “The employee takes the job without a committed schedule of hours. That’s where the risk is,” she said.

There are no laws that require employers to provide a minimum number of hours. However, Disselkamp said lean scheduling can backfire on employers if taken to extremes, because turnover will rise, adding to training costs.

Call-in shifts not just for high school students

In 2011, the department store Macy’s phased out call-in shifts. Instead, it began advertising for “flex team” jobs, which allow employees to log on to the scheduling system and choose available shifts, after full-time and part-time employees are scheduled. Beth Charlton, a Macy’s spokeswoman, said the move “works to the advantage of most associates. They are students, moms, and people who want to work part time. It accommodates their schedules.” If a student has exams, for example, Charlton said, a job on the team allows the flexibility to take a week off to study by simply not signing up to work shifts. However Charlton said flex team workers are not guaranteed a minimum number of hours.

In 2011, the Retail, Wholesale and Department Store Union negotiated a five-year contract with Macy’s on behalf of 4,000 workers at four stores in the New York City area. Union spokesman Dan Morris said Macy’s new scheduling system was an area of contention during the negotiations. As part of the contract, full- and part-time workers retained their status and their hours. The contract does not cover the flex team.

On-call schedules can benefit some students and other flexible workers, but experts say it’s outdated to think the majority of part time workers are people looking for extra spending money. H. Luke Shaefer, a professor of social work at the University of Michigan, said the long stretch of high unemployment led employees to take jobs they might not have considered in the past. Shaefer said in 2009, the last year the data is available, 45 percent of part-time workers were primary wage earners in their families.

But even for workers who provide only part of family’s income, on-call shifts can be a struggle. In 2011, 25-year-old Sheena Dixon found a job working a call-in shift at Levi’s in Manhattan. Dixon, who lives in the Bronx with her mother, a nursing assistant, contributed rent and grocery money and bought clothes for her sister, a high school student. At Levi’s, Dixon said she made $9.25 an hour, but often worked between four and 12 hours a week. She didn’t stay long.

“For me to do all of that just to get paid what I used to get paid when I was 14, that didn’t work for me at all,” she said. Asked what she plans to do next, Dixon said she is looking for a new retail job.

CORRECTED: States pushing efforts to require certification for cleaning medical instruments

New Jersey,United States — 2012-02-29T13:13:11-05:00

Correction, Feb. 29, 1:09pm: Due to incorrect information received from contributors to two bills before the New York State Assembly, the Center for Public Integrity inaccurately described a labor union’s opposition to requiring certification for central sterile processing workers. The bills would exempt current workers, and those who worked in the field two years prior to passage, from certification requirements. The 1099 SEIU Healthcare Workers East supports this legislation. A previous version of this story incorrectly stated that the bills would only exempt workers with two years of experience.

Reused surgical instruments are often dangerously dirty, a Center for Public Integrity investigation has revealed, but the workers charged with the high-stakes task of cleaning these complex devices face almost no state-mandated professional licensing or certification requirements.

Only New Jersey today has a law on the books that requires professional certification for central sterile technicians, the workers who clean and sterilize medical devices between procedures, most often in units located in hospital basements.

A professional association representing these central sterile workers is pushing certification legislation in three other states, but similar previous efforts have been stymied by labor unions, which argue that current workers should not be required to pass a written test to keep their jobs.

The stakes are potentially high. A Center for Public Integrity investigation published last week documented how advanced medical technology has created intricate medical tools that are difficult to clean and sterilize, a situation which experts say could put patients at increased risk for infection. Some hospitals, particularly those in large cities, have acted on their own to require central sterile workers to pass certification tests covering topics including microbiology, infection control, and sterilization techniques. Other hospitals do not, which industry leaders say creates uneven patient safety standards.

“The people who do your nails, they have to take an infection control course before they can apply for a license,” said Mary Olivera, the director of sterilization at a New York City medical facility and past president of the New York State Association of Central Service Professionals. “Same with a dog groomer. Yet the people who deal with lifesaving equipment, they are required to have zero education.”

As medical devices advance, the cleaning and disinfecting process has become much more technical and complex, said John Best, a central sterile processing unit manager at a Dayton, Ohio hospital, and president of the Buckeye Central Service Association. “There are so many methods of sterilization and so many high- dollar pieces of equipment that you have to understand. It’s more than the ‘day of the dishwasher,’ ” Best said.

Best said he hopes certification will ensure that workers learn new standards and keep their head in the job. “In the many places I have worked and seen, it’s amazing how people go on autopilot,” he said, adding that he often sees workers who don’t know correct cleaning processes.

In addition to pushing certification in Ohio, the Chicago-based International Association of Healthcare Central Service Materiel Management (IAHCSMM) is supporting certification bills in New York and is helping prepare legislation in Pennsylvania. Under these proposals, central sterile workers would have to pass exams prepared by IAHCSMM or the New Jersey based Certification Board for Sterile Processing and Distribution in order to work in hospitals.

Earlier this month, New York State Assemblyman Harry Bronson (D-Rochester) and Sen. Mark Grisanti (R-Buffalo) introduced identical bills that would require continuing education and professional certification for central sterile workers. The bills, however, exempt current workers from the certification requirement. In 2011, bills that would have required certification for workers with less than ten years of experience languished in the face of dissatisfaction by labor unions representing hospital workers.

“In New York, you need the unions to get the bill through,” said Jo Colacci, government affairs director at IAHCSSM, which is the main force behind the certification push in the states.

David Kranz, director of the professional and technical department at 1199 SEIU Healthcare Workers East, which represents healthcare workers from Massachusetts to Florida, said the union supports the 2012 bills in New York. The union opposed 2011 efforts.

In a 2011 letter to union members, Carmen Charles, president of the Healthcare Workers Local 420 in New York City, wrote that the union’s lobbyists stopped “proponents of this bill in their tracks.” Charles did not reply to calls for comment on the union’s position on the 2012 effort.

Colacci said IACHSMM is ready to compromise with the unions. But the grandfather clause in the current New York bills is difficult for many certification proponents to take.

“Seems like we are putting the unions ahead of the patients,” said Nancy Chobin, a sterile processing educator for the Saint Barnabas Health Care System in New Jersey and the executive director of the Certification Board for Sterile Processing and Distribution, an international non-profit certification board in the state.

At Saint Barnabas, Chobin said around ten people lost their jobs after New Jersey’s certification requirement went into effect in 2004. Chobin said those workers put off the test, took it at the last minute, and failed. “The truth is, if you cannot demonstrate minimum competency, you should not be working in the field,” she said.

In addition to unions, the move to require certification may run up against opposition from state hospital associations. In 2011, Pennsylvania State Representative Mauree Gingrich (R-Palmyra) announced she was preparing a certification bill. “It is critical that physicians be able to perform surgery without fear of patient safety and that patients can trust the equipment used will not complicate their circumstances for being hospitalized in the first place,” Gingrich wrote in a memo to House members.

Gingrich has not yet introduced the bill, but the measure already faces strong opposition from the state hospital association. Roger Baumgarten, a spokesman for the The Hospital and Healthsystem Association of Pennsylvania, said it opposes certification because hospitals have adequate sterilization protocols in place. “It is our contention that such a requirement is clinically unnecessary and would serve only to increase health care costs at a time when cost reduction and cost-effectiveness are critical to hospitals,” Baumgarten wrote in an email response to questions.

Gingrich said she is “not waiting for support from HAP” and will introduce the bill “within the next few weeks.”

To head off resistance in other states, Colacci said the association is trying to educate legislators about central sterile and the role it plays in infection control before introducing bills. In some states, she said that could take years. “Part of the problem is that when you go up against hospital associations, those associations have been in it for 50, 60, 70 years. They give a signification amount of money. They (the legislators) don’t know who we are.”

Filthy surgical instruments: The hidden threat in America's operating rooms

2012-06-17T16:00:50-04:00

It seemed simple enough at the time. In 2009, John Harrison, a 63–year-old oil industry sales manager in Mission, Texas, had surgery to repair the rotator cuff in his right shoulder, a routine procedure that usually requires at most a single night’s stay in the hospital, followed by physical therapy. For Harrison, however, there was nothing routine about the ordeal that ensued.

In the weeks following the surgery, his scar turned bright red, hot to the touch, and oozed thick fluid that looked “like butter squeezed from a bag.” Alarmed, Harrison’s wife, Laura, called The Methodist Hospital in Houston, where the surgery was performed. The doctor urged Harrison to immediately make the seven-hour drive back to Houston for an emergency checkup.

That night, surgeons opened up Harrison’s shoulder and found that infection had eaten away part of his shoulder bone and rotator cuff. Screws and metal hardware surgeons placed in his shoulder had pulled loose. Sutures had come undone. Surgeons cleaned out Harrison’s shoulder, installed two drains and gave him antibiotics to battle the infection.

When Harrison awoke from that surgery, he imagined his nightmare was over. But in reality, it had just begun. Since then, what began as a simple operation has turned into a lengthy struggle that left him for months at a time dependent on hired nurses, unable to dress himself, take a shower, or work, and afraid for his life.

“I’m a pretty tough guy, being in the oil patch,” said Harrison, a soft-spoken man who tends to understate the severity of his ordeal. But the pain “felt like someone hit your shoulder with a baseball bat with a razor blade attached to it.”

Harrison at first blamed himself, thinking he had not taken proper care of his surgical wound. The truth was much worse: Harrison was one of at least seven joint surgery patients at Methodist who acquired dangerous infections during a two-week period. The outbreak led Methodist to close operating rooms and cancel knee and shoulder surgeries while hospital and Centers for Disease Control and Prevention (CDC) investigators searched for the cause.

They found two likely sources in unlikely, yet terrifying, spots — deep inside a hand-held power tool called an arthroscopic shaver, which surgeons use to shave away bone and tissue during surgery, and inside a long narrow metal tube called an inflow/outflow cannula, which is used to irrigate and suction the surgical site.

During the Methodist investigation, the hospital inspected surgical tools with a tiny video camera to make sure places impossible to see with the naked eye were clean. They were not. Inside the cannulas and arthroscopic shavers, the video camera made startling finds. Human tissue and bone were stuck in both devices. The camera also discovered a bristle from a cleaning brush in an arthroscopic shaver.

Further investigation revealed that Methodist had not cleaned the cannulas with brushes, as manufacturer instructions require. Instead, the hospital ran tap water through the instruments.

The case of the dirty arthroscopic shavers, however, was even more frightening. According to accounts by Methodist staff and a government infection control researcher, the hospital followed the cleaning instructions provided by Stryker, the Kalamazoo, Mich. manufacturer of the shavers used on all the infected patients. The instruments had been properly cleaned, but they were still dirty. That set off alarms that would travel through the larger medical community. Dr. Pritish Tosh, a former investigator at the Centers for Disease Control and Prevention Epidemic Intelligence Service, blames the Methodist infections on those dirty devices. “Evidence from the investigation suggests the Methodist infection outbreak was most likely caused by retained tissue…,” Tosh wrote in a paper published in 2011 in the journal Infection Control and Hospital Epidemiology. The bacteria that caused the infections was “likely introduced into the case patients’ joint spaces” by dirty instruments or fluid that passed through them.

Investigators say hospital-acquired infections are notoriously difficult to track to their sources, but Tosh’s account is likely the only explanation Harrison is going to get for why he endured seven follow-up surgeries, but still cannot raise his arm when he wakes up in the morning.

“I’m angry,” said Harrison. “This is 2.5 years. I should be at the time of my life where I need to enjoy it a little bit.” In 2011, Harrison filed a lawsuit against Stryker and Methodist. Early this year, Harrison settled with Methodist for an undisclosed amount. His case against Stryker has been moved to federal court. Harrison’s attorney, Carl Shaw, declined to comment on the lawsuit. Stryker also declined to comment, but paperwork the company filed in court denies Harrison’s claims, arguing among several defenses that the firm’s arthroscopic shavers “conformed with the prevailing standard and customs of the state-of-the-art of the industry.”

A larger problem

Was the Methodist case a fluke? Hardly. Filthy, dangerous medical implements have been showing up in hospitals and outpatient surgery centers with alarming regularity. In 2009, the Department of Veterans Affairs admitted that 10,737 veterans in Florida, Tennessee and Georgia were given endoscopies or colonoscopies between 2002 and 2009 with endoscopes that may have been improperly cleaned. Some of those patients later tested positive for HIV, hepatitis C, or hepatitis B. Several lawsuits filed against the VA by veterans are currently working their way through the courts, and attorneys expect many others to follow. Investigation of a 2008 hepatitis C outbreak that sickened at least six people in Las Vegas revealed that an outpatient surgery center was improperly cleaning endoscopes and reusing biopsy forceps designed for a single use. Following that outbreak, a Centers for Medicare and Medicaid Services (CMS) pilot program inspected 1500 outpatient surgery centers and cited 28 percent for infection control deficiencies related to equipment cleaning and sterilization.

Last summer, the Food and Drug Administration (FDA), which regulates medical devices, held a little-noticed workshop to address concerns regarding dirty devices. Over two days, manufacturers, hospital representatives, and officials from the CDC and FDA described the challenges of thoroughly cleaning complex but reusable medical devices between procedures. Jahan Azizi, a risk management clinical engineer at the University of Michigan Health System, presented the most ominous data and conclusions to the crowd of around 200 government and industry insiders.

“This is unfortunately after lunch, and I apologize for that if you have a weak stomach,” Azizi said, as he described how his team ran a tiny surgical video camera inside 350 surgery-ready suction tips (a common tool surgeons use to suction blood and fluids). All of the suctions tips, Azizi said, contained blood, bone, tissue, even rust.

But what Azizi found next was even more troubling. After discovering the debris, Azizi’s team ran the 350 suction tips through the manufacturer’s recommended cleaning and disinfection processes and reexamined them. All but seven of the suction tips still contained debris. The problem, Azizi claimed, was a design flaw that caused debris to clog out of reach of cleaning brushes.

“I don’t know who approved this or who made this a reusable item, but this is not a reusable or cleanable item,” Azizi said about a particular suction tip, adding that when he cut the tip open, “a handful of stuff came out.” Azizi said he chose suction tips because they are included in almost every tray of instruments surgeons use, but that the lesson is far reaching. “There are a lot of them that are difficult or impossible to clean,” Azizi said.

A critic of the device manufacturing industry, Azizi blames poor manufacturer design for the difficulty of cleaning devices, but experts say bad design is but one of a litany of reasons why dirty instruments are being used on patients. At the FDA workshop, experts pointed to several other reasons, including the proliferation of highly complex surgical instruments, inadequate device testing by manufacturers, and the struggle faced by poorly-paid hospital employees who clean and sterilize devices between procedures, often under pressure from nurses and surgeons who need the devices quickly for the next operation.

It is difficult to know exactly how often dirty instruments are to blame for the infections that plague hospitals, since bacteria can hide anywhere from a doctor’s unwashed hands to a nurse’s dirty scrubs. But experts say it happens far more often than generally understood. “The cases we hear about,” said Dr. Melissa Schaefer, a CDC medical officer, “are only the tip of the iceberg.”

From hand scalpels to robots, high-tech creates new cleaning challenges

Decades ago, medical instruments were almost exclusively made of steel and glass, and many looked like the tools used by a butcher or an auto mechanic. Cleaning these tools was simple, and sterilization required little more than a heavy shot of steam.

The tremendous growth of minimally invasive surgeries in the 1990s, however, brought flexible endoscopes that are passed through tiny incisions to see inside patients. Instruments became smaller, more specialized and complex, with moving parts, tiny holes, and long narrow channels running the length of the implements. Manufacturers turned to materials like tungsten, plastic and other polymers. Progress continues. As surgeons begin to rely on robotics, devices are becoming even more elaborate.

Intricate modern instruments revolutionized surgery, but they have proven difficult to clean. Those tiny internal channels become clogged with unseen tissue and blood. Steam sterilization melts and destroys some modern devices. Instruments made of materials like rubber may not heat all the way through, as many metals do, creating sterilization challenges.

“Cleaning was once a basic factory job,” said Joe Lewelling, vice-president of standards development at the Association for the Advancement of Medical Instrumentation. “Now it’s very complex. It takes a lot of steps. It’s more like a laboratory process.”

Theoretically, if a device is truly impossible to clean, it should never end up on hospital shelves. The FDA, as part of its medical device clearance process, requires device manufacturers to verify that their cleaning instructions are effective. Few in the industry, however, believe the regulation works. Instead of testing their tools in the real world of hospitals, industry veterans say, manufacturers usually hire independent labs to evaluate their cleaning instructions under perfect conditions.

“If the lab can do the test, the lab has done their job for the manufacturer,” Trabue Bryans, a vice president and general manager of the lab company WuXi App Tec, said at an October meeting of the Association for the Advancement of Medical Instrumentation at the FDA. “We have all the time in the world.”

Stryker, the manufacturer of the arthroscopic shavers used in the Methodist infection cases, declined to say whether it tested its reprocessing instructions in hospitals.

The basement

In hospitals, the struggle to clean and sterilize surgical implements usually takes place in the basement, in hot, humid, “central sterile processing” units where employees, some making as little as $8.50-an-hour, work in fast-paced conditions to keep equipment in rotation.

Technicians are responsible for cleaning and sterilizing a vast range of instruments, from the tiniest forceps to intricate modern power tools. At the largest hospitals, as many as 40,000 devices pass through every day.

Charles Hancock, an independent medical device sterilization consultant in New York who has worked in the industry since the 1960s, said some central sterile departments are clean and efficient, while others are dirty and overcrowded with a “dungeon mentality.” Most, he said, are somewhere in the middle.

While instruments are often cleaned and sent back to surgery rapidly — perhaps too rapidly — Hancock said they also sometimes sit around for hours, or days, before they are cleaned, which allows blood and tissue to dry and harden. If a device is improperly cleaned prior to sterilization, the process can bake the blood and tissue on the instrument. With devices in rotation for years, or even decades, Hancock said the number of dirty devices currently in hospital supplies is likely massive.

But even in the best of conditions, many surgical tools are tough to clean. “Sometimes we have to beat the instrument on the table to loosen up the bone,” said Sharon Greene-Golden, a central sterile processing manager at Bon Secours Mary Immaculate Hospital in Newport News, Va., and president-elect of the International Association of Healthcare Central Service Materiel Management (IAHCSMM), which advocates for the central sterile industry.

“Labor and delivery sends trays that look like they have been to a massacre,” Greene-Golden said. “You get instruments that are covered in blood and amniotic fluid. They stink. Everything is terrible about them.”

Dressed in gowns, face shields, and rubber gloves, workers treat every instrument “as if the case had Ebola,” Greene-Golden said. But hospitals across the country have a limited number of tools and frequently pressure central sterile processing units to clean them as fast as possible in order to keep patients moving through profitable surgery suites. Since techs are the low man on the totem pole, it’s hard to push back against nurses and surgical staff.

Worst of all, central sterile techs say doctors and nurses rarely acknowledge their role in successful surgeries. Except when an important person or a doctor’s family member is on the table, that is. “They call and say, ‘Dr. Jones’ wife is having surgery,’” Green-Golden said. “You didn’t call when I was having surgery. You didn’t call when my momma was having surgery.”

The fast pace, low prestige and low pay leads to high staff turnover, sometimes for fast food or retail jobs. For those who stay, there is resentment. Candace Alston, 36, worked as a central sterile processing technician for ten years, at two different Virginia hospitals. While many others rotated through the basement, working a month or two before finding other jobs, Alston stayed. The gore got to her at first, Alston said, but she soon got used to it. “I enjoyed the work. I enjoyed the job,” she said.

Alston finally quit her job in August to study business administration online. The problem was compensation, Alston said, which had increased to $12 an hour, up from $8.50 when she started a decade earlier. “It’s demanding. You have people’s lives in your hands,” she said. “We have a lot of responsibility but not the pay.”

Robert Tremblay, a 27-year-old tech at a Boston hospital, said the job is frantic, especially in decontamination, the first step of device reprocessing, which he likens to “cleaning the dishes before you put them in the dishwasher.” But cleaning medical instruments is much more complex and tedious, Tremblay said, requiring special brushes to remove blood, bone and tissue from the nooks, crevices and channels. Skip one step, and the device is dirty. Does it happen? “All the time,” Tremblay said.

As Tremblay worked at the decontamination sink a few months ago, he cut his finger with a dirty dental pick, and had to be tested for HIV. Most central sterile workers have a similar story. Still Tremblay, who has a biology degree and is working toward a nursing degree, said jobs in the field are plentiful and it’s “better than working at Dunkin’ Donuts.”

If these secrets of central sterile processing are unknown to patients, they are equally mysterious to the doctors who use the equipment. Speaking at the FDA summit last summer, Dr. Daniel Schwartz, a chief medical officer at CMS, said that when he was in private urology practice, he assumed the tools he used were safe. Later, at CMS, Schwartz said he learned about “bio-burden, soil, design issues, and instruments that made it difficult to impossible to clean” and began to worry. “And my guess is most physicians would feel the same way if they heard some of the things that we're talking about today,” he said.

Central sterile techs play a key role in making sure clean devices make it to surgery suites, yet only New Jersey requires techs to be certified, despite a recent push by IAHCSMM and state organizations. “The people who do your nails, they have to take an infection control course before they can apply for a license,” said Mary Olivera, the director of sterilization at a New York City medical facility and past president of the New York State Association of Central Service Professionals. “Same with a dog groomer. Yet the people who deal with lifesaving equipment, they are required to have zero education.”

Earlier this month, New York State Assemblyman Harry Bronson (D-Rochester) and Sen. Mark Grisanti (R-Buffalo) introduced bills that would require professional certification for central sterile workers. Since 2007, Olivera and others have unsuccessfully pushed bills in the New York state legislature that would mandate licensure or certification. Jo Colacci, government affairs director at IAHCSMM, said hospital employee unions opposed previous bills proposing mandates.

FDA 'safety review' reveals problems, then vanishes

The fact that arthroscopic shavers retain tissue between patients is no surprise to Danny Tipei, the owner of Inex Surgical, a large surgical repair company outside Chicago that repairs broken arthroscopic shavers for hospitals and surgical centers. Tipei said it’s common for his technicians to take apart a shaver and find it clogged with flesh or bone.

“It looks like dried fruit, like skin from an apple that you leave for four or five days outside,” Tipei said. “It will be all dried out and twisted. We have tiny forceps that we use to remove it.”

At The Methodist Hospital, however, the infection outbreak and dirty shavers set off government alarms. Maureen Disbot, vice president of quality at Methodist, said the hospital brought in Stryker representatives and showed them how the device was retaining tissue, even after it was cleaned according to instructions. “We actually invited the manufacturer here when we started uncovering our findings, to make sure our interpretations are correct,” Disbot said. After consulting with Stryker, Disbot said the hospital was confident that it followed the manufacturer’s cleaning instructions. The problem, she said, was not the hospital’s cleaning method. Stryker declined to comment on Disbot’s account, but documents it filed in Harrison’s case say any damages resulted from acts or omissions by third parties.

After discovering the dirty instruments, Methodist informed the FDA, which in July of 2009 launched a safety review of arthroscopic shavers. But more than 2.5 years later, the FDA has done little to solve the problem, despite review findings that experts alternatively call “gross” and “scary.” According to FDA spokeswoman Karen Riley, the agency, as part of the safety review, asked arthroscopic shaver manufacturers to study how well their shavers were being cleaned at health care institutions. The FDA declined to make public what the manufacturers found, claiming the information is proprietary. But according to industry insider accounts, the findings showed serious potential for patient harm.

Nigel Wilkinson, senior vice president of regulatory affairs and quality at Massachusetts-based manufacturer Smith & Nephew, which manufactures shavers, presented his company’s findings at the FDA workshop this summer. Wilkinson said Smith & Nephew inspected 72 shavers at eight hospitals and surgery centers, and that all but three of the devices contained “residuals” after cleaning by hospital staff.

Wilkinson said none of the technicians at the medical facilities followed the company’s 11-step instructions, which order imprecise tasks including “scrub interfaces several times using a twisting action if possible.” In a telephone interview, Wilkinson said the investigation showed that many technicians are not properly trained and do not have adequate access to manufacturer instructions.

The company did not, however, investigate whether or not tissue remained even after technicians perfectly followed the company’s instructions. Asked if he thought the company’s shavers currently on the market are clean, he paused. “I would hope so,” he said. “But we’ve got thousands in the marketplace. I could not say what is going on with all of them.”

Azizi, at the University of Michigan Health System, said in addition to surgical suction tips, his team also inspected 15 arthroscopic shavers. He found biological material and other debris in all of them.

Stryker declined to release the results of the arthroscopic shaver study it performed at the request of the FDA, but Rodney Parker, senior manager of clinical sciences at the firm, said the company’s results were similar to Smith and Nephew’s. Despite the Methodist case, Parker said he isn’t worried about the device being a major cause of infections, since it has been on the market for decades. Asked about the dirty devices manufacturers found during the FDA safety review, he said he didn’t know who is to blame. “Is it the cleaning that did it or is it the design that did it? I don’t know,” Parker said. “Can we do a better job at education? Yeah.”

Stryker spokeswoman Tamara Cutler declined to comment further on the issues of cleanliness with the company’s arthroscopic shavers, but forwarded this email message: “As a global medical device company, we work with many regulatory agencies, including the FDA, to ensure our products and practices meet all quality and safety standards.”

In October 2009, five months after the infection outbreak at Methodist, Stryker issued clarified cleaning instructions for their arthroscopic shavers. The process included ten steps, the final one recommending cleaning staff use a digital scope to visually inspect the insides of the handpiece. “If visible soil remains, repeat steps 1-9, focusing on areas that have soil remaining.”

Since the infections, Disbot said Methodist technicians inspect the interior of every shaver with a tiny video camera to make sure it is clean before it is used. “We regret that our patients had this experience,” Disbot said, “but we have done everything and we have now fixed the problem. That’s what we stand on.” But Disbot admits it’s questionable whether or not the lessons learned at a large academic hospital have trickled down to smaller hospitals. “I can’t say that a rural hospital in Michigan knows about Methodist’s work,” she said.

Despite the Methodist infections and the alarming FDA safety review findings, the agency has ordered no system-wide mandatory check of arthroscopic shavers. No products have been recalled. The FDA posted an alert on its website encouraging facilities that use the shavers to evaluate the adequacy of their cleaning procedures, and file a voluntary report to the agency if they find shavers retaining tissue between users. The agency said it has received no further reports of shavers retaining tissue. Manufacturers, including Stryker, also sent warnings to their customers.

Asked why the agency has not done more in the face of evidence on dirty devices, Riley at the FDA said “these are important products that have been used for decades with little evidence of risk to public health as a result of reprocessing.” Further, Riley wrote that “in 2010, there were 2.1 million arthroscopic procedures of the knee performed and yet total adverse events from all causes was 1 percent. This does not merit withdrawal of a valuable device.”

Charles Hancock, the New York private sterilization consultant, claimed Riley’s numbers are meaningless. It’s well-known in the industry, Hancock said, that hospitals frown on staff reporting all but the most obvious and severe adverse events because it draws scrutiny. “No one disputes that,” Hancock. “Those numbers are irrelevant.” The true number, he said, is likely much higher.

Workers in sterile processing units are also agree that dirty devices are a widespread problem. Asked if dirty devices are regularly making their way into surgical suites at some hospitals, Lesa Jackson, a supervisor of sterile processing at St. Luke’s Episcopal Hospital in Houston, said she has no doubt. “Oh yes,” she said. “Yes. Yes.”

Riley at the FDA said the safety review of arthroscopic shavers has been folded into a larger effort to ensure that all medical devices are correctly reprocessed. So far, that effort has resulted in draft agency guidance released last summer suggesting manufactureres develop more robust reprocessing instructions appropriate for the real world hospital environment. The draft also suggests changes to pre-market device testing criteria. The draft guidance, if and when it becomes final (a FDA spokeswoman said it is unclear when the final rules will be released) will serve as a guide for device manufacturers as they seek FDA clearance for new devices.

But the guidance, which the draft points out “does not establish legally enforceable responsibilities,” would have little or no effect on the thousands of devices already being used by surgeons, including the arthroscopic shaver used on John Harrison.

More than 2.5 years after his initial surgery, Harrison’s shoulder looks like it has been hit by shrapnel. He can’t scratch his head. He can’t cast a fishing lure. He may face additional surgeries to bring his range of motion back to what it was before he first went under the knife, a prospect he finds terrifying.

Most of all, he regrets putting his wife, Laura, through the struggle. Harrison said he was delirious on that journey back to the hospital after his initial surgery. Laura drove and talked to him to keep him awake. He was “out of it” for much of the next year, and his caregiving fell to her.

And it was Laura who first learned from doctors about just how much danger Harrison was in. Soon after his second surgery, Harrison wanted to leave the hospital and go home, and did not understand why he couldn’t. That’s when Laura told him what he was facing. “She says, ‘John, we’re not trying to make you better. We’re trying to save your life,’” Harrison recalls. “I took my IV with me, went into the bathroom, and had a good cry.”

Watchdog groups call on Newt Gingrich to disclose all health center clients

Washington,United States — 2012-01-27T17:20:49-05:00

Public interest groups on Friday called on Republican presidential candidate Newt Gingrich to make public a full list of health care companies that paid his Washington think tank for advice as far back as 2003.

“Gingrich has been unapologetic about his work so I can’t imagine why it would be a problem to release a full list of his clients,” said Tom Fitton, president of the conservative group Judicial Watch. “Politically, disclosure can’t and probably won’t hurt — but secrecy can.”

The for-profit Center for Health Transformation since 2003 has signed up some 300 health care businesses, from giant insurance companies and drug manufacturers to technology startups. With Gingrich at the helm, the center took an active role in circulating policy papers, testifying at congressional hearings and taking other steps to build support for dozens of pieces of legislation and federal policy initiatives that would financially benefit its clients.

The Center for Public Integrity detailed the health center’s activities in a report published Thursday. Gingrich severed ties with the center last year.

Gingrich has denied lobbying and the K Street think tank has declined to identify clients who paid as much as $200,000 a year for memberships. However, the Center for Public Integrity obtained a partial list from 2009 showing members such as Microsoft, drug maker AstraZeneca, insurance giant WellPoint, management consultant firm Booz Allen Hamilton, GE Healthcare, Siemens, Allscripts, UPS, GlaxoSmithKline, Merck and the BlueCross Blue Shield Association. (See the 2009 list here)

“Releasing these names now is a good idea,” said Melanie Sloan, executive director of the liberal watchdog group Citizens for Responsibility and Ethics in Washington, which has been a vocal critic of Gingrich’s advocacy efforts. “These folks were paying him a fortune and he was advocating for positions that benefited them. There’s no doubt about that,” she said.

The 2009 list shows 17 of the 91 companies were “charter members,” which health center officials said cost them $200,000 a year. AstraZeneca, WellPoint, Microsoft and Booz Allen Hamilton were among those charter members.

Earlier this week, Republican rival Mitt Romney said Gingrich should disclose his list of clients to make sure he did not break any rules. “Let’s see who his clients were at the time he was lobbying Republican congressmen for Medicare Part D,” Romney said to CNN. “Was he working or were his entities working for any health care clients that could have benefited from that?”

Whether these sorts of activities are lobbying — or “influence peddling,” as Romney has claimed — is in dispute. Prodded by Romney, Gingrich has released a contract that paid $25,000 a month for services to troubled mortgage holder Freddie Mac, and has insisted nothing he did there constituted lobbying. But Romney has argued that the contract and Gingrich’s other work in Washington belie his claim to be running as an outsider.

Neither Gingrich nor center officials responded to requests for comment on Friday. But Gingrich has repeatedly denied lobbying, as has the center.

“It is important for him to be transparent,” said Meredith McGehee, policy director at the Campaign Legal Center. “The harder he tries to not disclose the more people feel there is something that he doesn’t want people to see. Running for president is whole different level of scrutiny,” she said.

Gingrich's health center was power player in a host of Washington policy debates

2012-01-31T12:20:03-05:00

Newt Gingrich’s Washington-based advocacy on behalf of a broad array of health care interests has been far more extensive than the Republican presidential candidate has acknowledged, a review by the Center for Public Integrity has found.

Since 2003, the former House speaker’s Center for Health Transformation has taken an active role in circulating policy papers, testifying at congressional hearings and using other forums to build support for dozens of pieces of legislation and federal policy initiatives that would financially benefit clients who paid as much as $200,000 a year for his services, records show. The center’s advocacy has ranged from promoting costly high- technology medicine to pressing for tax breaks benefiting purchasers of controversial high-deductible insurance plans. Gingrich severed ties with the center last year.

Gingrich’s health center markets itself as a think tank focused on health care innovation. It does not release its membership roster, but the Center for Public Integrity obtained a partial list from 2009. Among the members at that time: Microsoft, drug maker AstraZeneca, insurance giant WellPoint, management consultant firm Booz Allen Hamilton, GE Healthcare, Siemens, Allscripts, UPS, GlaxoSmithKline, Merck and the BlueCross Blue Shield Association. (See the 2009 list here)

In one display of his influence on Capitol Hill, Gingrich appeared at a December 2007 Russell Senate Office Building press conference to promote a bill requiring that Medicare accept prescriptions electronically — a bill in which at least 20 center members had a financial stake or other interest.

“We are committed to the idea that electronic prescribing saves lives and saves money,” Gingrich said that day, sharing the stage with Sen. John Kerry, D-Mass., and three other senators who were sponsors of the legislation.

Lobbying or not?

Whether these sorts of activities are lobbying — or “influence peddling,” as rival Mitt Romney has claimed — is in dispute. Prodded by Romney, Gingrich has released a contract that paid $25,000 a month for services to troubled mortgage holder Freddie Mac, and has insisted nothing he did there constituted lobbying. But Romney has argued that the contract and Gingrich’s other work in Washington belie his claim to be running as an outsider.

Federal law defines lobbying narrowly, so many powerful former politicians are able to influence policy matters without having to actually register as a lobbyist. The law defines a lobbyist as someone employed or retained by a client for compensation whose services include more than one lobbying contact and whose lobbying activities constitute 20 percent or more of his or her services’ time on behalf of that client during any three-month period.

Neither Gingrich nor center officials responded to requests for comment. But Gingrich’s Newt2012 website states: “Newt has never engaged in lobbying, period. Newt made a decision after resigning that he would never be a lobbyist so that nobody would ever question the genuine nature of his advice and perspectives.”

The center also has denied lobbying. A statement on the center’s website from chairwoman and CEO Nancy Desmond reads: “We do no lobbying for clients and always make that very clear from the outset. We clearly stipulated that fact in our contracts.”

But Julian Zelizer, a professor of history and public affairs at Princeton University, said Gingrich’s testimony on behalf of clients makes him “susceptible to the charge that he was lobbying, even though he was not a lobbyist.”

James Thurber, director of the Center for Congressional and Presidential Studies at American University, said the law lacks teeth, especially in regard to former members of Congress. “Gingrich was in the advocacy business,” Thurber said. “It gets around the letter of the law, but he’s a lobbyist, in my opinion.”

While much of the controversy has swirled around Gingrich’s work for Freddie Mac, the for-profit Center for Health Transformation signed up hundreds of health care businesses, from giant insurance companies and drug manufacturers to technology startups. And there’s no question some of these clients believe Gingrich got results.

For instance, Gingrich client ZixCorp, which sells email encryption systems, said in a Sept. 16, 2008, news release that Gingrich was “instrumental in orchestrating the support required” to make electronic prescribing a reality.

The center has signed up some 300 clients since 2003 and grossed more than $55 million, according to its website. Members pay from $20,000 to $200,000 a year. The center has refused to disclose the names of its clients, citing confidentiality provisions in its contracts. But a 2009 list obtained by the Center for Public Integrity shows 91 companies that were then paying a total of about $7 million in annual memberships.

The 2009 list shows 17 of the 91 companies were “charter members,” which center officials said cost them $200,000 a year. AstraZeneca, WellPoint, Microsoft and Booz Allen Hamilton were among those charter members.

A range of benefits

Many clients have helped write “white papers” and other position statements that are presented under the center’s brand, sometimes to government panels and other times through webcasts or other live events and trade shows that featured Gingrich as a draw. Topics can range from new approaches to treating Alzheimer’s disease to support for legislation pushing Medicare funding for drug packaging that helps elderly people remember to take their medicine.

For instance, MeadWestvaco joined the center in supporting the “Medication Therapy Management Expanded Benefits Act of 2010.” The bill sought Medicare payments for new packaging of medicines, a specialty of the Richmond, Va., company.

In a white paper published in February of last year, the center and the company said that failure to take medicine as directed was estimated to cost 125,000 lives annually and result in more than “$100 billion spent each year on avoidable hospitalizations.”

The legislation was introduced by Sen. Al Franken, a liberal Minnesota Democrat and fellow Democrat Kay Hagan of North Carolina. It and a similar House bill each died in committee in 2010. A new version has been filed.

A February 2011 MeadWestvaco press release quotes Gingrich calling the packaging concept a “smart, proven way to realize cost savings, create efficiencies for doctors and pharmacists and provide tangible health benefits to patients.”

Gingrich and the center also touted its clients to state lawmakers wrestling with soaring costs for Medicaid, the health care program targeting low income people, which is administered jointly by the states and the federal government.

In January 2004, Gingrich met with Georgia House Republicans and claimed that nine of his clients could save the state close to $1billion annually in health care costs and improve services, according to the center’s website. Gingrich indicated, however, that the numbers were “submitted from the companies and have not been validated by an outside party.”

One of the money-saving firms Gingrich cited was PKC Corporation, a small Vermont-based company that sells software designed to help doctors and patients make health care decisions. PKC wasn’t a member for long, said Howard Pierce, the company’s CEO. Pierce said he traveled to Washington in 2003, met with Gingrich, and paid a few thousand dollars to join the Center for Health Transformation in hopes that Gingrich would help his company win support from state governments, the Centers for Medicare and Medicaid Services and Congress.

“In order to get that audience you have to do whatever you can do, and that can mean leveraging someone else’s influence,” Pierce said. “Sometimes there is a quid-pro-quo for doing that. Sometimes that is money.”

But as the Gingrich organization grew and larger health care interests joined, Pierce said, he began to feel that PKC was getting little for its investment. “It felt like in order to get the real attention, you had to up your financial participation in Newt’s world,” Pierce said.

Pierce said he believes Gingrich has good ideas for how to transform health care, but doubts the candidate is being straight about his role at the health center. “When I hear him saying he is an historian and not an influence peddler, that sort of stops me in my tracks,” Pierce said.

But Ritch Haynes, executive vice president of HealthTrio, a health information technology company that Gingrich also pitched in Georgia, said center membership simply gives access to “industry thought leaders.” Haynes said he didn’t think Gingrich was trying to promote his company in Georgia. “He was trying to promote a concept,” Haynes said.

Marketing on the Hill

A review of Gingrich’s congressional testimony shows that he often boasted of accomplishments by his clients.

At a March 15, 2006, hearing before the House Subcommittee on the Federal Workforce and Agency Organization, Gingrich laid out his vision for using health information technology to achieve what he termed “a 21st century intelligent health system that saves lives and saves money for all Americans.” He cited member companies favorably eight times.

In one instance, Gingrich sang the praises of a hospital system in the Pacific Northwest that created personal health records for patients with the help of GE Healthcare. GE Healthcare, a subsidiary of General Electric, is a “platinum member” of the health transformation center. Gingrich also has served on the board of GE’s healthymagination, which promotes the company’s computerized medical records systems.

In his 2006 testimony, Gingrich also cited a Utah medical clinic that had saved $1 million through an electronic medical records systems built by Allscripts, also a center member. He also mentioned HealthTrio, crediting the company with a system called SnoMed that he said can measure health outcomes and detect fraud.

Gingrich went on to state that companies developing electronic records systems “should take the lead” in developing standards for their use. He cited three such companies, Siemens, GE Healthcare and Allscripts, all center clients.

David Merritt, then the center’s project director, testified in Sept. 2006 before a Department of Labor advisory council on the benefits of health information technology. He urged the secretary of labor to require that doctors and hospitals upgrade to electronic recordkeeping systems. President Obama’s health reform measure, the Affordable Health Care Act, eventually included billions in funding to encourage adaptation of electronic health records.

In February 2007, the center released a “Health Action Agenda for the 110th Congress” that advocated a series of plans, from health saving accounts to initiatives pushing screening for early cancer detection.

“We can transform health and healthcare to deliver more choices of greater quality at lower cost to every American. It will take innovative ideas, the right priorities and bold leadership — and we must act now,” the report states.

The report spells out more than five dozen policy prescriptions it says would create a “next generation of healthcare consumerism.”

Key to reaching that goal, according to the report, is new legislation to spread “health savings accounts,” or HSAs, in which people are allowed to manage their health care spending. The report calls for enactment of several pieces of legislation, concluding: “Current law stands in the way of progress.”

The center also has advocated for health savings accounts at the state level since at least 2005. In 2007, it released a policy document, “A Guide for State Legislators: Creating an HSA State,” which advocated tax credits for businesses that offer them to employees.

In May of 2008, it scored a victory in Georgia. With Gingrich standing nearby, then- Georgia Gov. Sonny Perdue signed a law exempting HSA-linked health plans from state premium taxes and gave employers a $250 tax credit for each employee it enrolled in a plan with an HSA.

In September 2008, Ronald E. Bachman, a senior fellow at the center, praised the Georgia law at a House Energy and Commerce Health Subcommittee hearing on health reform. In his testimony, Bachman pushed for a variety of federal reforms, including a requirement that allows health savings accounts to be used with any health insurance plan, and removal of federal income and employment taxes from premiums.

Public interest groups are skeptical when former lawmakers push proposals linked to paying clients. Gingrich is just the latest to attract that sort of scrutiny. Former Sen. Tom Daschle, a prominent Obama supporter, received the same sort of attention when he was hired by a hefty roster of health care clients. Like Gingrich, Daschle was a staunch proponent of electronic medical records systems.

Princeton professor Zelizer noted that Gingrich’s well known propensity to embrace new ideas makes it difficult to challenge his motives.

“Gingrich is trickier than some because he does have ideas and he does support these causes,” Zelizer said. “At the same time, when you have connections with people who can make money off this, it’s hard to disentangle promoting an idea from promoting an interest.”

Is Michael Jackson's doctor disqualified from Medicare? Or are two senators mistaken?

2011-12-01T15:51:41-05:00

The Obama Administration is disputing claims by two Republican senators that Michael Jackson’s physician mistakenly remained eligible to bill Medicare long after being convicted for his role in the singer’s 2009 death. But the lawmakers aren’t backing down.

Sens. Orrin Hatch, R-Utah, and Tom Coburn, R-Oklahoma, on Tuesday sent a letter to Medicare’s administrator alleging that Jackson’s doctor, Conrad Murray, and at least 34 other convicted felons and unlicensed physicians remain listed as legitimate physicians on the health plan’s provider database. Murray was convicted of involuntary manslaughter in November, which the Senators said should have caused him to be immediately kicked out of the program.

Centers for Medicare and Medicaid spokesman Brian Cook said the senators are mistaken. Conrad’s “enrollments have been revoked and deactivated, and the latest that he billed Medicare was in 2010,” Cook said. The spokesman declined to comment further about the other doctors the senators mentioned in the letter, or to shed light on the precise day when Murray was pushed out of the program.

So far, the senators are not buying the CMS explanation.

“Not only did CMS fail to address any of concerns Senator Hatch or Dr. Coburn repeatedly raised, they failed to remove Dr. Murray from CMS’ provider database,” said Julia Lawless, a Republican press secretary at the Senate Finance Committee. To back up that allegation, Lawless pointed to the public Medicare ordering and referring report, which CMS says is used “to verify that an individual physician or eligible professional has an approved enrollment record.” Dr. Murray is on that list, which was last updated on November 21, 14 days after his conviction. “The reality is, CMS did not take the necessary action to remove Dr. Murray from its provider database, until November 30th, the day after they received our letter,” Lawless said.

Cook did not did not return calls requesting a response to the legislators’ latest assertion.

Both CMS and the Office of Inspector General at the Department of Health and Human Services have authority to remove physicians from the Medicare program. Don White, a spokesman for the OIG, said the office has not yet barred Murray. But since the doctor has been sentenced, he now faces mandatory exclusion as soon as the office receives formal notice of conviction from the court. White did not know how long that would take. “There is a process in place,” White said, “and it is functioning and the outcome for Dr. Murray will be decided based on that due process.” White said all excluded providers have 30 days to appeal the exclusion.

In the Senator’s Tuesday letter, they cite a lack of communication between CMS, state agencies, and federal law enforcement as one cause of the problem.

“In a time of increased technological capability,” they wrote, “it appears CMS is disconnected. Without data sharing agreements with its law enforcement partners, we fear CMS will remain in the dark and Medicare beneficiaries will be placed at risk.”

Michael Jackson's doctor, other convicted felons, still listed as Medicare providers

2011-12-01T15:30:15-05:00

Michael Jackson’s private physician, Dr. Conrad Murray, was sentenced to four years in jail Tuesday for his role in the singer’s 2009 death, but so far he hasn’t been pushed out of the Medicare program.

According to a letter two senior Republicans on the Senate Finance Committee sent to Medicare’s administrator on Tuesday, Murray and other convicted felons and unlicensed physicians are still listed as legitimate physicians on the health plan’s provider database, pointing to a serious vulnerability that leaves the program open to fraud and could put seniors at risk.

Conrad’s case “illustrates Medicare’s failure to act in the best interest of seniors,” wrote Sens. Orrin Hatch, R-Utah, and Tom Coburn, R-Okla, in the letter to Health and Human Services Secretary Kathleen Sebelius. A spokesman for the Centers for Medicare and Medicaid Services had no immediate comment.

Murray’s case is a high profile example of Medicare’s failure to remove convicted felons and doctors who have lost their medical licenses from the program, an issue highlighted earlier this year by iWatch News. In Murray’s case, California suspended his medical license in January. In November, Murray was convicted of involuntary manslaughter. Yet Murray is still listed as a Medicare provider in the CMS internal database. “Despite the national media coverage of Dr. Murray’s conviction, he remains a legitimate Medicare provider,” Hatch and Coburn wrote in the letter.

Jackson’s doctor is not an isolated case. In the letter to Sebelius, the senators reference an Ohio physician who continues to have a valid Medicare provider number despite a conviction for conspiracy to commit murder, as well as physicians who have been convicted of tax evasion, health care fraud, drug distribution and “lewd and lascivious behavior.” The letter does not name the physicians.

Tuesday’s letter is not the first time the senators have sounded the alarm about felons in Medicare. In September, the senators sent a letter to Dr. Donald Berwick, CMS’s outgoing administrator, listing 34 doctors and other providers who were convicted of a felony or pleaded guilty but retained their Medicare privileges. In November, Berwick responded by letter, and said in many of the cases, Medicare lacks authority to exclude the providers because they were convicted on non-excludable offenses, including felony drunk driving charges and hunting violations.

In response Tuesday, the senators called Berwick’s response troubling, since he pointed to the exceptions. Lack of communication between CMS and federal law enforcement agencies may be one cause of the felon problem. In Tuesday’s letter to Sebelius, the senators expressed exasperation that CMS does not have data sharing agreement to share felony indictment and conviction data with the Department of Justice, the Internal Revenue Service, state agencies, and even with its own Office of Inspector General.

Supreme Court will hear challenge to health reform law

2011-11-14T14:37:08-05:00

When the Supreme Court this morning announced plans to hear a challenge to the 2010 health care overhaul, it set the stage for a high-stakes showdown over the most controversial policy initiative of the Obama administration — an initiative that lined the pockets of K Street lobbyists in the run-up to passage of the Affordable Health Care Act.

The Supreme Court order announced that justices will hear oral arguments on the constitutionality of the linchpin provision of the legislation — the mandate that all individuals must have health insurance or face fines. The high court will also examine whether the health care law can be implemented absent the so-called individual mandate.

Court watchers say oral arguments will probably take place in March, with a decision likely in late June, as the stretch run begins for the 2012 presidential election campaign. The decision will no doubt be one of the most watched debated in the court’s history, because it speaks to both the limits of Congress and personal liberty, and for the influence it could have on the election.

Four U.S. Circuit Courts of Appeals have already ruled on the law—two declaring it unconstitutional. The Supreme Court decision is rooted in an appeal from the U.S. Court of Appeals for the 11^th Circuit, in Atlanta, which struck down the individual health insurance mandate section of the law.

The Supreme Court ruling could be the endgame to a policy struggle that dates back to the earliest days of the Obama administration, a battle that resulted in a boon to K Street lobbyists. In 2009 alone, iWatch News found that more than 1,750 individual companies and organizations hired more than 4,500 lobbyists — eight for each member of Congress — to influence the outcome of health reform legislation. Health care reform was particularly profitable to Washington lobby firms because few industries are untouched by its provisions, leading to major expenditures not only by health-related companies, but also by a wide range of businesses ranging from Campbell’s Soup to Dunkin’ Donuts.

Digital mammography no better than film for most women, despite increased costs

2011-10-31T16:45:31-04:00

A new study comparing digital mammography with less expensive film mammography found that the two types of breast cancer screens are equally effective at detecting cancers in most women, underscoring the conclusions reached by a recent iWatch News investigation.

The study, published Monday in Annals of Internal Medicine, compared the accuracy of digital and film mammograms received by 300,000 women aged 40 to 79 in community medical practices between 2000 and 2006; it found that the screening tests performed equally well among these women as a group. However, the study also found that digital mammograms were better at detecting estrogen receptor-negative tumors and cancers in women with extremely dense breasts, both of which are more common in younger women. The study was performed by the National Cancer Institute-funded Breast Cancer Surveillance Consortium.

In contrast with an earlier study that suggested film mammograms perform better for older women, the study found that digital mammography performs equally as well as film mammograms for that group.

“If you are under 50, you should probably have digital,” said Dr. Karla Kerlikowske, a professor at the University of California, San Francisco, and lead author of the study. “If you are over 50, either one would be fine. If someone goes to a clinic and all they have is film, that’s fine. If all they have is digital, that’s fine, too.”

Although the two types of cancer screens perform equally well for most women overall, digital mammograms, which are reimbursed at a higher rate by Medicare and private insurers, have taken over the industry. Earlier this year, iWatch News showed how manufacturers of the digital test equipment used political influence and direct advertising aimed at women to secure increased Medicare reimbursement rates. Those increased reimbursement rates fueled the industry transition to digital mammography despite a lack of science proving the new technology was better for older women.

The iWatch News investigation examined Medicare claims data from 2003 to 2005, and found that digital mammograms increased the cost of breast cancer screening for older women by more than $350 million over that time period.

Speaking about the increased cost of digital mammograms, Kerlikowske said her study did not take cost into account. “That is another thing altogether,” she said.

An accompanying Breast Cancer Surveillance Consortium study published in the same issue of Annals of Internal Medicine found that in 10 years of annual mammograms, more than half of all women without breast cancer will be called back at least once for more testing, and about one in 12 will be referred for a biopsy. Screening every other year for 10 years, however, lowered the rate of false positives by almost a third. Among women who were diagnosed with cancer, the study found that those screened every other year were not significantly more likely to be diagnosed with late-stage cancer than those screened yearly.

“We hope that if women know what to expect with screening, they’ll feel less anxiety if — or when — they are called back for more testing,” said Rebecca Hubbard, the lead author of the study. “In the vast majority of cases, this does not mean they have cancer.”

Debate rages over cancer screening

2012-05-22T10:55:56-04:00

A government panel’s controversial recommendation that healthy men should no longer be routinely screened for prostate cancer is fueling a continuing debate over unnecessary Medicare spending for cancer screening — the subject of a recent iWatch News investigation.

Last week, draft guidelines of the U.S. Preventive Services Task Force advised men against routine prostate cancer screening using the prostate-specific antigen (PSA) test because the test often leads to more harm than good, with the potential for harm posed by aggressive treatment offsetting any gain.

The findings were strongly disputed by the American Urological Association, which called the task force recommendations a disservice to men. The urologists say the test saves lives and provides important information to men about their health. On Friday, however, the Annals of Internal Medicine published an outside panel’s review of evidence backing the task force recommendations.

The debate last week centered on the value of the PSA test, but the cost to government health plans — both for the test and subsequent treatment — lurks in the background. An iWatch News story reported that forty percent of Medicare spending on common cancer screening — including the PSA test — is likely unnecessary. Cancer screening tests are vastly overused in the United States, the investigation found, in part because doctors disregard scientific evidence out of ignorance, fear of malpractice suits, for financial gain, or in response to patient demand.

Report faults Medicare controls on widely abused drugs

2011-10-04T09:29:58-04:00

Tens of thousands of Medicare beneficiaries are obtaining prescriptions for addictive drugs from multiple doctors, says a new auditor’s report, underscoring the need for Medicare to better police its drug benefit program – an issue highlighted early this year by iWatch News.

During 2008, 170,000 Medicare Part D beneficiaries acquired frequently abused drugs — primarily hydrocodone and oxycodone — from five or more doctors, at a cost of $148 million, according to a report to be released later today by the Government Accountability Office (GAO). According to the investigation on so-called doctor shopping, 600 Medicare beneficiaries received prescriptions from as many as 87 medical practitioners in the same year.

The GAO said the Centers for Medicare and Medicaid Services (CMS) has systems in place to identify inappropriate drug use by beneficiaries, but said that “measures to stop the activity are limited.” The watchdog agency also said stricter controls over prescription drugs are needed to reduce drug abuse and addiction. CMS is part of the Department of Health and Human Services.

In addition to addicts who seek out drugs for personal use, Medicare has long been a lucrative target for criminals who exploit the program for profit. Attorney General Eric Holder estimated the program loses $60 billion a year to fraud.

Early this year, iWatch News reported that criminals successfully billed Medicare for prescription drugs using the names of deceased physicians, a scam that is difficult to catch due to inadequate CMS oversight of contractors. At that time, CMS was not checking to make sure that prescriptions paid for by the program were written by real doctors. Oversight of contractors was so inadequate that the agency could not identify the top prescribers of oxycodone and Ritalin, two highly addictive drugs that are often trafficked on the streets.

To address the doctor shopping problem, the GAO report recommends Medicare administrators consider forcing suspected patients to receive prescriptions from a single prescriber, a single pharmacy, or both, an initiative that has been successful for some private insurance plans. It suggested Medicare administrators consider starting such a program by focusing on hydrocodone and oxycodone. In response to the report, Medicare administrators agreed the program needs to improve efforts to “curb overutilization,” but disagreed that a restricted recipient program was necessarily the solution.

Sen. Tom Carper, D-Del., one of those who requested the GAO inquiry, said the abuse of drugs by beneficiaries “strains an already costly program, wastes taxpayer dollars and steals resources from seniors and the disabled who need the program’s critical assistance.” Sen. Scott Brown, R-Mass., a co-requester of the report, said CMS “must immediately increase its oversight of this important program and begin notifying proper law enforcement agencies of potential abuses.”

Witnesses from the GAO and the Centers for Medicare and Medicaid Services are expected to testify on the issue at Senate subcommittee hearing later today.

Senators want more aggressive action to curb rampant Medicare fraud

2011-10-03T07:48:30-04:00

Two prominent Republican senators are pushing Medicare’s administrator to block convicted felons and doctors with revoked licenses from successfully billing the federal health care program for the elderly, an issue that was highlighted by iWatch News early this year.

In the letter to Donald Berwick, administrator of the Centers for Medicare and Medicaid Services (CMS), Sen. Orrin Hatch, R-Utah, and Sen. Tom Coburn, R-Oklahoma, wrote that Medicare contractors are allowing doctors and scam artists to retain Medicare billing privileges even if they have lost their medical licenses or have been convicted of felonies related to tax evasion, health care fraud, and “lewd and lascivious conduct.” Medicare contracts with 11 companies nationwide to administer claims for the program. The letter also includes a list of possibly dubious practitioners and a request that CMS determine if they should be revoked from the program.

“By not taking the appropriate administrative action against providers and suppliers who are convicted or who have pled guilty to financial crimes and other felonies … CMS is abdicating its financial responsibility and placing Medicare beneficiaries at increased risk of poor quality health care,” the senators wrote.

The Medicare program has long been a lucrative target for criminals; Attorney General Eric Holder estimated the program loses $60 billion a year to fraud. Early this year, iWatch News reported that criminals successfully billed Medicare for prescription drugs using the names of deceased physicians, a scam that is difficult to catch due to inadequate CMS oversight of contractors. At that time, CMS was not checking to make sure that prescriptions paid for by the program were written by real doctors. Oversight of contractors was so inadequate that the agency could not identify the top prescribers of oxycodone and Ritalin, two highly addictive drugs that are often trafficked on the streets.

According to this week’s letter by Hatch and Coburn, CMS and its contractors may also have failed to determine the criminal status of Medicare providers or check whether they have valid medical licenses. The Senators faulted “the apparent lack of meaningful coordination and communication” between CMS, the Department of Justice, and the Internal Revenue Service. They also expressed concern that Medicare contractors “may be failing to investigate and … revoke” Medicare billing privileges of physicians whose medical licenses have been suspended or revoked.

The senators requested that Berwick explain how the agency communicates with federal law enforcement agencies to ensure it learns of felony convictions, and describe the process through which the agency removes doctors from the program when they are convicted or plead guilty to health care fraud. The senators also asked the agency to explain how it verifies that its contractors are on the lookout for doctors whose licenses are revoked.

Ellen Griffith, a CMS spokeswoman, declined to comment because the agency has not yet had a chance to review the letter.